Faculty Handbook 2016–17
draft in progress

New York State Flex Spending Account (FSA)
Pretax Benefit Plans

The Flex Spending Account (FSA) is a negotiated state employee benefit that saves you money by allowing you to pay for certain expenses with pretax dollars. Under this program, you may choose two benefits:

  1. The Health Care Spending Account (HCSAccount) lets you set aside any amount from $100 to $2,500 (for the 2015 plan year) to pay for health-related expenses that are not reimbursed by your insurance or other benefit plans. Because it is indexed to inflation, the maximum contribution is subject to change annually.
    Please note: To comply with the requirements of the Affordable Care Act, new employees who enroll in the Health Care Spending Account during the plan year have a 60-day waiting period before their coverage begins. The Health Care Spending Account eligibility period for a new employee will begin on the 61st consecutive calendar day of employment.
  2. The Dependent Care Advantage Account (DCAAccount) allows your family to set aside up to $5,000 in pretax salary for eligible child care, elder care, or disabled dependent care expenses that are necessary for you and your spouse (if you are married) to work. For DCAAccount employer contribution rates, which are on a sliding scale (from $300 to $800) according to salary, please visit the New York State Flex Spending Account’s DCAA site.

For details on eligibility, maximum allowable contributions, and plan information, please visit the New York State Flex Spending Account site, www.flexspend.ny.gov.

Forfeiture of Funds Not Claimed for Reimbursement
Before participating in either plan, you should carefully consider what your eligible expenses might be. Reviewing your expenses from previous years can help. Once you have estimated the amount of your expenses, you may then determine how much to contribute. Under federal law, any money that you put into a pretax Flex Spending Account must be used for expenses incurred during the plan year in which it was contributed. Any funds that you do not claim for reimbursement are forfeited at the end of the plan year.

Please note: On October 31, 2013, the U.S. Department of the Treasury and the IRS announced a modification of the “use it or lose it” rule for health care flexible spending arrangements. The modification guidance permits employers to allow plan participants to carry over up to $500 of their unused health FSA balances remaining at the end of a plan year. The State of New York is currently reviewing the IRS ruling, so it has not made a decision to change the Health Care Spending Account rules at this time. Employees should not assume that the changes will be adopted when calculating their annual election amounts.

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